State Ex Rel. Susan Boggs v. City of Cleveland

• Decision Date: 25 August 2011
• Docket Number: No. 09–4403.,09–4403.
• Citation: 655 F.3d 516
• Parties: State of OHIO ex rel. Susan BOGGS; Fouad Rachid, for himself and as next friend for Nicole Rachid; and Fouad, Inc., Plaintiffs–Appellants,v.CITY OF CLEVELAND, Defendant–Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

655 F.3d 516

State of OHIO ex rel. Susan BOGGS; Fouad Rachid, for himself and as next friend for Nicole Rachid; and Fouad, Inc., Plaintiffs–Appellants,

v.CITY OF CLEVELAND, Defendant–Appellee.

No. 09–4403.

United States Court of Appeals, Sixth Circuit.

Argued: March 4, 2011.Decided and Filed: Aug. 25, 2011.

ARGUED: David E. Mills, The Mills Law Office LLC, Cleveland, Ohio, for Appellants. Thomas J. Kaiser, City of Cleveland, Department of Law, Cleveland, Ohio, for Appellee. ON BRIEF: David E. Mills, The Mills Law Office LLC, Cleveland, Ohio, for Appellants. Thomas J. Kaiser, Joseph G. Hajjar, City of Cleveland, Department of Law, Cleveland, Ohio, for Appellee.Before: MOORE and WHITE, Circuit Judges; VARLAN, District Judge. ^*

OPINION

THOMAS A. VARLAN, District Judge.

Susan Boggs (“Boggs”) and Fouad Rachid (“Rachid”), individually and on behalf of their minor daughter, and Fouad, Inc. (“Fouad”) (Boggs, Rachid, and Fouad, together, the “relators”) appeal the district court's order dismissing their action on the basis of res judicata in favor of the City of Cleveland (the “City”). For the following reasons, we reverse the district court and remand the case for further proceedings.

I. BACKGROUND

In 1995, Fouad purchased the property located at 24505 Barrett Road in Olmsted Township, Ohio (the “subject property”). Fouad is an Ohio corporation, and Rachid is its President and majority shareholder. Since 1995, Boggs and Rachid have lived on the subject property with their daughter. According to the relators, the subject property is positioned under the flight paths of two runways—currently known as 6L–24R and 6R24L—of the Cleveland Hopkins International Airport (the “Airport”).

In 2002, the relators filed a class-action mandamus action in the Court of Common Pleas, Cuyahoga County, Ohio seeking to compel the City, pursuant to Article I, Section 19 of the Ohio Constitution, to initiate appropriation proceedings with respect to property located near the Airport, including the subject property (the “2002 Action”). The relators claimed the level and frequency of flights over the property so interfered with their use and enjoyment of the property that it had been taken for public use without just compensation.

The City moved to dismiss the 2002 Action, arguing that Boggs and Rachid lacked standing to bring the action because they had no legal interest in the subject property as it was owned by Fouad. The City also argued that Fouad failed to state a claim on the merits because, as a corporation, it could not use the subject property as a residence. The court granted the City's motion stating only: “Plaintiff's [sic] motion to dismiss complaint for failure to state a claim upon which relief can be granted filed on 11–21–02, is granted. Final.” Appellant Br. 7; see also Appellee Br. 8.

The relators appealed to the state court of appeals, which dismissed the appeal, concluding that the trial court's order was not a final, appealable order because it dismissed the complaint without prejudice. In response, the trial court issued an order stating only: “Plaintiff's [sic] motion to dismiss complaint for failure to state a claim upon which relief can be granted filed 11–21–02, is granted. Complaint is dismissed with prejudice. Final.” Appellant Br. 7; see also Appellee Br. 8–9. The relators did not appeal this order.

On August 1, 2008, the relators filed a new mandamus action in Ohio state court, seeking to compel the City to commence appropriation proceedings with respect to the subject property pursuant to the Fifth Amendment to the United States Constitution, the Ohio Constitution, and other applicable laws (the “2008 Action”). In the 2008 Action, the action underlying this appeal, the relators allege the City relocated runway 6L–24R in a phased construction project undertaken around 2000 and further expanded that runway in August 2004. They also allege that in 2007, the same runway was expanded to accommodate larger aircraft with heavier fuel loads, and that the expansion of runway 6R–24L is underway.

On the basis of these allegations, and others, the relators claim the subject property lies 3,700 feet from runway 6L–24R in violation of federal laws and Federal Aviation Administration regulations. They also claim the expanded runways resulted in increased runway traffic and intolerable noise, filth, and general disruption, which interferes with their use and enjoyment of the subject property. In addition, the relators claim they have been exposed to harmful or cancer-causing toxins as a result of the expanded runways, which contaminated their well water and will require medical monitoring.

The City removed the case to federal court and, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, filed a motion to dismiss based on res judicata. The district court granted the motion and dismissed the action with prejudice. The relators timely appealed.

II. STANDARD OF REVIEW

We review de novo a district court's order granting a motion to dismiss pursuant to Rule 12(b)(6). Zaluski v. United Am. Healthcare Corp., 527 F.3d 564, 570 (6th Cir.2008) (citation omitted). We also review “de novo a district court's application of res judicata.” Buck v. Thomas M. Cooley Law Sch., 597 F.3d 812, 816 (6th Cir.2010) (quoting Bragg v. Flint Bd. of Educ., 570 F.3d 775, 776 (6th Cir.2009)).

III. DISCUSSION

State-court judgments are given the same preclusive effect under the doctrines of res judicata and collateral estoppel as they “would receive in courts of the rendering state.” ABS Indus., Inc. ex rel. ABS Litig. Trust v. Fifth Third Bank, 333 Fed.Appx. 994, 998 (6th Cir.2009) (quoting Ingram v. City of Columbus, 185 F.3d 579, 593 (6th Cir.1999)). In other words, “ ‘[i]f an individual is precluded from litigating a suit in state court by the traditional principles of res judicata, he is similarly precluded from litigating the suit in federal court.’ ” Id. (quoting Gutierrez v. Lynch, 826 F.2d 1534, 1537 (6th Cir.1987)). We look “to the state's law to assess the preclusive effect it would attach to that judgment.” Id. (citations omitted).

“Under Ohio law, the doctrine of res judicata consists of ‘the two related concepts of claim preclusion, also known as res judicata or estoppel by judgment, and issue preclusion, also known as collateral estoppel.’ ” Doe ex rel. Doe v. Jackson Local Schs. Sch. Dist., 422 Fed.Appx. 497, 500 (6th Cir.2011) (quoting O'Nesti v. DeBartolo Realty Corp., 113 Ohio St.3d 59, 862 N.E.2d 803, 806 (2007)). “ ‘Claim preclusion prevents subsequent actions, by the same parties or their privies, based upon any claim arising out of a transaction that was the subject of a previous action.’ ” Id. (citations omitted). The doctrine “bars subsequent actions whose claims ‘could have been litigated in the previous suit[.]’ ” Id. (alteration in original and citation omitted). Issue preclusion, on the other hand, “prevents the ‘relitigation of any fact or point that was determined by a court of competent jurisdiction in a previous action between the same parties or their privies [,]’ even if the causes of action differ.” Id. (alteration in original and citation omitted). A review of the parties' arguments reveals that they use the term “res judicata” to refer to claim preclusion only.

The Sixth Circuit has interpreted Ohio's doctrine of claim preclusion as having four elements:

(1) a prior final, valid decision on the merits by a court of competent jurisdiction; (2) a second action involving the same parties, or their privies, as the first; (3) a second action raising claims that were or could have been litigated in the first action; and (4) a second action arising out of the transaction or occurrence that was the subject matter of the previous action.

Hapgood v. City of Warren, 127 F.3d 490, 493 (6th Cir.1997) (quoting Felder v. Cmty. Mut. Ins. Co., No. 96–3320, 1997 WL 160373, at *3–4 (6th Cir. April 4, 1997) (unpublished)). The party asserting the defense bears the burden of proof. ABS Indus., 333 Fed.Appx. at 998 (citing Winget v. JP Morgan Chase Bank, N.A., 537 F.3d 565, 572 (6th Cir.2008)).A. Relators Boggs and Rachid

The relators argue the 2002 Action was not dismissed on the merits as to Boggs and Rachid because their claims were dismissed for lack of standing.¹ Indeed, under Ohio law, dismissals for want of standing do not have preclusive effect because they are not decided “on the merits.” State ex rel. Coles v. Granville, 116 Ohio St.3d 231, 877 N.E.2d 968, 977 (2007) (citations omitted); Asher v. City of Cincinnati, No. C–990345, 2000 WL 955617, at *1 (Ohio Ct.App. Dec. 23, 1999) (finding a prior suit was not decided on the merits because it was dismissed for lack of standing); A–1 Nursing Care of Cleveland, Inc. v. Florence Nightingale Nursing, Inc., 97 Ohio App.3d 623, 647 N.E.2d 222, 225 (1994) (noting that a “motion to dismiss for lack of standing terminates the action other than on the merits and affords proper parties the opportunity to refile without fear of the effects of res judicata ”). The City, however, contends that because the relators failed to appeal the trial court's second order, which included the language “dismissed with prejudice,” Boggs and Rachid acquiesced to the finality of that judgment, thus triggering the application of res judicata.

Although the City's argument is not without support under Ohio law, see, e.g., Mason v. GFS Leasing and Mgmt., No. 79536, 2002 WL 192097, at *3 (Ohio Ct.App. Feb. 7, 2002) (applying res judicata where appellant failed to appeal the trial court's erroneous, final judgment applying res judicata in a prior case), we cannot find that the 2002 Action was dismissed “on the merits” with respect to Boggs and Rachid in light of Superior Piping Contractors, Inc. v. Reilly Industries, Inc., No. 84871, 2005 WL 678987 (Ohio Ct.App. Mar. 24, 2005).²

In Superior Piping, Superior Piping Contractors, Inc. (“Superior”) filed a complaint against Reilly...